However, not everyone shares this optimism: crypto influencer Crypto Rover sees warning signs in spot demand, according to tradingview.com.
Why the explosive growth is a thing of the past
Ju explains this by saying that the market has changed. Whilst Bitcoin was a small-cap asset and retail investors predominated amongst buyers, speculative capital would drive the price to dizzying heights and then cause it to plummet by 80 per cent. Now the market is much larger, and the proportion of institutional investors is growing, which smooths out both extremes. According to the analyst, the same forces that are holding back growth are also cushioning the falls.
He sees confirmation of this in the PnL Index, which tracks the aggregate returns of holders. The peaks of the cycles, as measured by this indicator, are becoming less pronounced, whilst the troughs are forming at a higher level of profitability.
Another argument relates to the MVRV. In the current cycle, the ratio has never fallen below 1. This means that even at its lows, BTC remained above the average on-chain purchase price of the coins. Some investors cut their losses, but holders as a whole never ended up in the red.
Signs of growth and reasons for caution
Ju highlights several signs that point to a bullish market:
– realised capitalisation is rising, which means fresh capital is flowing in;
– long-standing ‘whales’ have stopped selling;
– major players in the futures market have built up large long positions near the bottom.
Furthermore, the 365-day moving average of the PnL Index, which usually lags behind at turning points, is now showing a marked reversal.
At the same time, the analyst emphasises that there is no ceiling for Bitcoin. It is simply that the situation has changed: the end of parabolic growth also means the end of 80 per cent crashes. It is precisely this, he says, that is attracting patient, long-term capital rather than hot money.
The path to this has been a winding one, but ultimately Bitcoin may come close to what Satoshi Nakamoto described: an asset stable enough to actually be used as money. If this happens, Ju believes, internet capital has the potential to change the world far more profoundly than many realise.
An analyst at Crypto Rover takes a different view. He points out that spot demand for BTC is weakening with every price movement. On the Bitcoin chart, he sees a bearish divergence, which indicates weakness in the cryptocurrency.
This story was translated with the assistance of artificial intelligence.The translation was also reviewed by the Logos Press editorial team.
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